If you have been fortunate enough to negotiate favourable rates for your electricity and gas supplies then you should pat yourself on the back. But don’t sit back and relax for too long, because you absolutely must keep an eye on the end-dates for your contracts. And if you are moving premises and think your special rates are going to relocate with you, think again.
So why do you need to keep a close eye on the contract end-dates? Well there’s a very good reason. If you find yourself outside of them on ‘out of contract rates’ (OOCR) you could find yourself paying up to double what you’ve been used to paying: something that could have a significant effect on your profits.
Put a note in your diary for at least three months before each energy contract is due to end. As soon as the reminder flags up, start researching new deals. Scanning the market can take some time, as can negotiating with existing suppliers. Leave it to the last minute and you may be forced to accept rates that aren’t as beneficial as others you may have come across with time on your side.
If you are moving premises then it is important to realise that energy contracts do not move with you. Unlike other contracts they cannot be transferred from one location to another. Instead they cease without penalty under what is called Change of Tenancy. Many businesses don’t realise this, and find out a few months after their move when they receive bills that are much higher than expected. So what do you need to do?
Ahead of your move, contact your energy suppliers to see if you can negotiate new contracts at your new premises. Also spend some time comparing tariffs from other suppliers in case you can land something more favourable.
Sourcing the Best Rates
Whilst this may seem a time consuming business, it will be worth it when you realise how much you can save. It is also worth noting there are companies who provide a sourcing service and who will scan the whole market on your behalf for the best deals. Some of them can even lock you into favourable rates in anticipation of your switch over. Usually there won’t be a charge for the service, as they make their money on commission from the energy suppliers.
Your bookkeepers will usually be able to help in pointing you in the right direction when it comes to energy suppliers and tariffs and of course will be able to illustrate how you will fair financially with any new rates you are offered.